Report: Amazon Plans To Launch Travel Service, Hotel Booking

Skift is reporting that Amazon (AMZN) is poised to launch its own travel service, featuring booking at independent hotels and resorts near major cities.

The initial rollout of Amazon Travel would feature a curated selection of hotels within a few hours’ drive from New York, Los Angeles, and Seattle. The service will likely go live around January 1.

Skift spoke with representatives of three independent hotels, two of which signed up for the new Amazon service and one that was strongly considering the option.

Properties would load their room types, availability, pricing information, and photos into an Amazon extranet and would pay a standard 15% commission to Amazon for the prepaid bookings, the hoteliers at the independent properties said.

The properties would get notified by Amazon via email of bookings, hoteliers said, and they would update calendars on the extranet.

The hotels would generally list their properties at rack rates, but would be free to discount, one hotelier said.

Hoteliers would receive their payments from Amazon for the stays in two installments and could obviously attempt to negotiate a lower commission than the standard 15%.

The Proposition

The hotelier who hadn’t yet signed up for the Amazon Travel service after being approached by an Amazon sales representative two weeks ago said he was giving “heavy consideration” to participating.

“First and foremost, it’s Amazon.com,” said the hotelier, adding that most of the hotel’s bookings currently come from its own website, although the resort also displays its inventory on Booking.com.

The hotelier said Amazon had used TripAdvisor ratings as part of the criteria for selecting properties to participate, and would only use a few properties per destination, and they would have to be rated four stars and above.

Amazon would round out the content on Amazon Travel with editorial about attractions and other things to do in the destination. At least initially, Amazon would focus on hotels, and not flights or other travel products.

Another hotelier from one of the two properties that had signed on said Amazon has a huge customer database to leverage, and that would be one of the attractions of signing up.

Amazon did not respond to a request for comment.

Amazon’s mission is to create a marketplace for retailers who might have a difficulty finding customers, and a high-profile section of Amazon.com in the form of an Amazon Travel would offer such a marketplace for independent and boutique hotels who don’t have the marketing power of big hotels chains or online travel agencies at their disposal.

Amazon potentially has an advantage over some online travel agencies and hotel booking sites because of the immense amount of data — i.e. Big Data — at Amazon’s disposal. Amazon could pair information about a traveler’s intent with retail offers such as a GoPro camera to use while hiking or boating in Washington State.